Catalogue PPI changes demanded
Friday, 21 Nov 2008 13:01
Catalogues and PPI to be decoupled
Payment protection insurance (PPI) sold with home shopping catalogues is set to come under tough new rules.
The Competition Commission (CC) today published proposals to banning firms from selling PPI next to products in catalogues, with distributors to be forced to wait 14 days before offering insurance.
The CC found: "Retail PPI is highly profitable for distributors and there is little competition between providers on price and other factors, limited ability for customers to search for alternatives or switch products and a considerable point-of-sale advantage for the providers."
It also found polices were complex, customers were hindered from switching to new providers, and distributors were failing to actively seek to win customers by using the price or quality of their retail PPI policies.
The suggestions for catalogue – or retail – PPI follow those set down last week by the CC for the rest of the PPI industry.
Proposals include a PPI best buy table and retail credit providers to provide a 'personal PPI quote', which will clearly state the cost of the PPI policy individually and when added to the credit product.
Last week the bank and insurance industry hit out at the proposals claiming they would kill PPI at a time when consumers needed extra protection during the economic storm.